Need a Debt Payoff Strategy? One of These 5 Methods Could Work for You

This illustration shows a man swimming up form his debt.
Getty Images
Some of the links in this post are from our sponsors. We provide you with accurate, reliable information. Learn more about how we make money and select our advertising partners.

Your reasons for being in debt are as unique as you are. Whether it’s because of a student loan, mortgage, credit card or combination thereof, debt can happen to the best of us. The good news: The way you pull yourself out can be just as unique (and a lot more rewarding). There are well-known debt payoff strategies out there like the snowball and avalanche methods. And companies like National Debt Relief help by negotiating with your creditors to resolve your debt.

We also rounded up some of our favorite strategies that Penny Hoarders themselves use.

Debt Payoff Strategies

Debt payoff strategies come in all sizes — from ultra-focused intensive to “every little bit helps” methods. Fortunately for us, Penny Hoarders are generous about sharing their ideas. Here are five innovative debt payoff strategies to inspire you.

1. Find a Money Buddy

Just because you’re getting out of debt, doesn’t mean you have to do it alone.

Friends Sau-Sha Hill and Sha’Kreshia Terrell decided to work together to pay off their combined $70,000 in credit card debt.

They started by writing down goals they wanted to achieve each month, then holding the other’s credit cards to prevent the temptation of impulse purchases.

Holding each other accountable paid off for them: In just one year they paid off $27,000 of their combined debt. They continue to encourage each other’s new, healthier spending habits.

Check out how an accountability partner can help you pay down debt.

2. Get a Side Hustle

Eventually, you run out of ways to cut costs. You can either resign yourself to a life stuck in debt or find more money.

When former Penny Hoarder staff writer Lisa Rowan added up her total debt, she faced a daunting total of $51,679. But instead of burying her head, she looked for ways to make extra money to pay off her debt. At her busiest point, Rowan juggled two 20-hour per week positions, her own shop, a gig packaging stationery and multiple freelance assignments.

Combining the extra money with strategies like using a balance transfer card and cutting expenses, she side-hustled her way to paying off $30,435 in 18 months.

Find out how a side hustle can help you pay down debt with these tips.

3. Round Off Numbers

All those Type A cleaning tendencies could pay off when you tidy up your account balances to nice, round figures.

TPH Community member Marlena Montalvo posted that she’s halfway to her goal of paying off her mortgage in eight years. Her secret? A combination of rounding up payments, making double monthly payments when possible and using the 00.00 concept.

So if she checks her balance and it’s $1,581.64, she makes a payment of $81.64 to get the balance to an even $1,500.00.

“Little things like that make a huge difference,” Montalvo wrote.

4. Write What You Spend

Post-It Notes have stuck around for a reason: It’s easier to remind yourself when you see it right there in front of you. The same goes for financial goals.

Tyler and Ashley Philbrook have paid off $6,000 of the $25,000-plus they had in credit card and student loan debt and have put away over $10,000 in savings.

Although they thought they were sticking to their budget every month, it wasn’t until Tyler created an Excel spreadsheet to track every expense that they realized they were overspending every month. They started a budgeting journal to track daily expenses, which helped them see they saved a lot more money by cooking at home.

5. Automate With Apps

Paying off debt doesn’t have to be a massive undertaking — sometimes all it takes to help is some common cents. (Sorry, couldn’t help myself.)

When TPH Community member Shara Freeman made it her goal to pay off her student loans, she decided to automate the payoff with apps. Apps like Chipper and Changed round up the change from everyday transactions and apply it toward your debts.

Tiffany Wendeln Connors is a former staff writer at The Penny Hoarder. Read her bio and other work here, then catch her on Twitter @TiffanyWendeln.